Case of Nykänen v. Finland

FOURTH SECTION
CASE OF NYKÄNEN v. FINLAND
(Application no. 11828/11)
JUDGMENT
STRASBOURG
20 May 2014
This judgment will become final in the circumstances set out in Article 44 § 2 of
the Convention. It may be subject to editorial revision.
NYKÄNEN v. FINLAND JUDGMENT
1
In the case of Nykänen v. Finland,
The European Court of Human Rights (Fourth Section), sitting as a
Chamber composed of:
Ineta Ziemele, President,
Päivi Hirvelä,
George Nicolaou,
Nona Tsotsoria,
Zdravka Kalaydjieva,
Krzysztof Wojtyczek,
Faris Vehabović, judges,
and Françoise Elens-Passos, Section Registrar,
Having deliberated in private on 15 April 2014,
Delivers the following judgment, which was adopted on that date:
PROCEDURE
1. The case originated in an application (no. 11828/11) against the
Republic of Finland lodged with the Court under Article 34 of the
Convention for the Protection of Human Rights and Fundamental Freedoms
(“the Convention”) by a Finnish national, Mr Mikko Tapani Nykänen (“the
applicant”), on 17 February 2011.
2. The applicant was represented by Mr Atte Niemi, a lawyer practising
in Lahti. The Finnish Government (“the Government”) were represented by
their Agent, Mr Arto Kosonen of the Ministry for Foreign Affairs.
3. The applicant complained under Article 4 of Protocol No. 7 to the
Convention about double jeopardy (ne bis in idem) involving taxation
proceedings, in which a tax surcharge had been imposed, and criminal
proceedings for tax fraud.
4. On 18 June 2012 the application was communicated to the
Government.
THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
5. The applicant was born in 1972 and lives in Espoo.
A. Taxation proceedings
6. The tax inspector conducted a tax inspection in a company in 2005.
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NYKÄNEN v. FINLAND JUDGMENT
7. On 28 November 2005 the tax authorities considered that the
applicant had received 33,000 euros (EUR) as disguised dividends from that
company during the tax year 2003. An additional tax and a tax surcharge
(veronkorotus, skatteförhöjning) of EUR 1,700 were imposed.
8. The applicant sought rectification from the local Tax Rectification
Committee
(verotuksen
oikaisulautakunta,
prövningsnämnden
i
beskattningsärenden).
9. On 25 January 2006 the Tax Rectification Committee rejected the
applicant’s application. It found that the applicant had given incomplete
information to taxation authorities and tax had therefore been incompletely
or partially levied. Therefore the additional tax and the tax surcharges
imposed on him were not considered to be too high.
10. The applicant appealed to the Kuopio Administrative Court
(hallinto-oikeus, förvaltningsdomstolen).
11. On 29 May 2008 the Kuopio Administrative Court rejected the
applicant’s appeal on the same grounds as the Tax Rectification Committee.
12. The applicant appealed to the Supreme Administrative Court
(korkein hallinto-oikeus, högsta förvaltningsdomstolen).
13. On 1 April 2009 the Supreme Administrative Court refused the
applicant leave to appeal.
B. Criminal proceedings
14. On 19 August 2008 the public prosecutor brought charges against
the applicant of, inter alia, tax fraud (veropetos, skattebedrägeri)
concerning the tax year 2003. According to the charges, the applicant was
accused of tax fraud as he had under-declared his income. The undeclared
income amounted to EUR 33,000 for the tax year 2003 and, consequently,
the tax imposed in 2003 had been EUR 12,420 too low.
15. On 13 February 2009 the Tuusula District Court (käräjäoikeus,
tingsrätten) convicted the applicant of tax fraud and imposed a suspended
prison sentence of 8 months. He was also ordered to pay to the tax authority
EUR 9,500 plus interest. The court found that the amount of disguised
dividends was EUR 26,882.90 and that the tax due amounted to EUR 9,500.
16. By letter dated 26 April 2010 the applicant appealed to the Helsinki
Appeal Court (hovioikeus, hovrätten), requesting that the charges be
dismissed.
17. On 25 March 2010 the Helsinki Appeal Court convicted the
applicant as charged and sentenced him to 10 months in prison. It ordered
the applicant to pay the tax authorities EUR 12,420 plus interest. The court
found that, contrary to the opinion of the District Court, the value-added tax
was to be included in the amount of disguised dividends. The correct
amount of disguised dividends was thus EUR 33,000 and the tax evaded
amounted to EUR 12,420.
NYKÄNEN v. FINLAND JUDGMENT
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18. By letter dated 24 May 2010 the applicant appealed to the Supreme
Court (korkein oikeus, högsta domstolen), requesting that the charges and
the compensation claim be dismissed without examining the merits or
alternatively that they be rejected. He claimed, by referring to Article 4 of
Protocol No. 7 to the Convention and to the Court’s case-law, that the ne bis
in idem principle had been violated as tax surcharges had already been
imposed for the same acts by a decision which had become final.
19. On 1 September 2010 the Supreme Court refused the applicant leave
to appeal.
II. RELEVANT DOMESTIC LAW AND PRACTICE
A. Tax Assessment Procedure Act
20. Section 57, subsection 1, of the Tax Assessment Procedure Act (laki
verotusmenettelystä, lagen om beskattningsförfarande, Act no. 1558/1995,
as amended by Act no. 1079/2005) provides that if a person has failed to
make the required tax returns or has given incomplete, misleading or false
information to taxation authorities and tax has therefore been incompletely
or partially levied, the taxpayer shall be ordered to pay unpaid taxes
together with an additional tax and a tax surcharge.
B. Penal Code
21. According to Chapter 29, sections 1 and 2, of the Penal Code
(rikoslaki, strafflagen; as amended by Acts no. 1228/1997 and
no. 769/1990), a person who (1) gives a taxation authority false information
on a fact that influences the assessment of tax, (2) files a tax return
concealing a fact that influences the assessment of tax, (3) for the purpose of
avoiding tax, fails to observe a duty pertaining to taxation, influencing the
assessment of tax, or (4) acts otherwise fraudulently and thereby causes or
attempts to cause a tax not to be assessed, or too low a tax to be assessed or
a tax to be unduly refunded, shall be sentenced for tax fraud to a fine or to
imprisonment for a period of up to two years.
22. If by the tax fraud (1) considerable financial benefit is sought or
(2) the offence is committed in a particularly methodical manner and the tax
fraud is aggravated when assessed as a whole, the offender shall be
sentenced for aggravated tax fraud to imprisonment for a period between
four months and four years.
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NYKÄNEN v. FINLAND JUDGMENT
C. Supreme Court’s case-law
23. The Supreme Court has taken a stand on the ne bis in idem principle
in its case KKO 2010:46 which concerned tax surcharges and aggravated
tax fraud. In that case it found, inter alia, that even though a final judgment
in a taxation case, in which tax surcharges had been imposed, prevented
criminal charges being brought about the same matter, such preventive
effect could not be accorded to pending cases (lis pendens) crossing from
administrative proceedings to criminal proceedings or vice versa.
24. On 20 September 2012 the Supreme Court issued another judgment
(KKO:2012:79) concerning ne bis in idem. It stated that, in some cases, a
tax surcharge decision could be considered final even before the time-limit
for ordinary appeal against the decision had expired. However, it was
required that an objective assessment of such a case permitted the
conclusion that the taxpayer, by his or her own conduct, had intended to
settle the tax surcharge matter with final effect. The assessment had to
concern the situation as a whole, and it could give significance to such
questions as to how logically the taxpayer had acted in order to settle the
taxes and tax surcharges, to what extent he or she had paid taxes and tax
surcharges, and at which stage of the criminal proceedings the payments had
been made. In the case at issue taxes and tax surcharges had been imposed
on A on account of action related to disguised dividends, by decisions of
2 March 2009 for tax years 2005 and 2006, and 7 September 2009 for tax
year 2007. In the charge, which became pending on 28 June 2011, the
prosecutor demanded that A be sentenced to punishment for aggravated tax
fraud on account of the same action. A had paid the taxes and tax surcharges
entirely before the charge became pending. The time-limit for seeking
rectification in respect of tax year 2005 had expired on 31 December 2011
without A having sought rectification. A declared that he had no intention of
appealing against the decisions concerning the other tax years, either. The
Supreme Court held that the charge of aggravated fraud was inadmissible as
A had paid the taxes and tax surcharges before the charge became pending.
25. In its newest case-law (KKO:2013:59 of 5 July 2013), the Supreme
Court reversed its earlier line of interpretation, finding that charges for tax
fraud could no longer be brought if there was already a decision to order or
not to order tax surcharges in the same matter. If the taxation authorities had
exercised their decision-making powers regarding tax surcharges, a criminal
charge could no longer be brought for a tax fraud offence based on the same
facts, or if such a charge was already pending, it could no longer be
pursued. The court assessed whether the preventive effect of the first set of
proceedings had to be attributed to the fact that 1) tax surcharge proceedings
were pending, 2) a tax surcharge issue was decided, or 3) to the finality of
such a tax surcharge decision, and found the second option the most
justifiable.
NYKÄNEN v. FINLAND JUDGMENT
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D. Legislative amendments
26. In December 2012 the Government submitted to Parliament a
proposal for an Act on Tax Surcharges and Customs Duty Surcharges
Imposed by a Separate Decision and for certain related Acts (HE 191/2012
vp). After the entry into force of the Act, the tax authorities could, when
making a tax decision, assess whether to impose a tax surcharge or to report
the matter to the police. The tax authorities could decide not to impose a tax
surcharge. If they had not reported the matter to the police, a tax surcharge
could be imposed by a separate decision by the end of the calendar year
following the actual tax decision. If the tax authorities had imposed tax
surcharges, they could no longer report the same matter to the police unless,
after imposing the tax surcharges, they had received evidence of new or
recently revealed facts. If the tax authorities had reported the matter to the
police, tax surcharges could, as a rule, no longer be imposed. The purpose
of the proposed Act is thus to ensure that a tax or a customs duty matter is
processed and possibly punished in only one set of proceedings.
27. The proposed Act on Tax Surcharges and Customs Duty Surcharges
Imposed by a Separate Decision (laki erillisellä päätöksellä määrättävästä
veron- tai tullinkorotuksesta, lagen om skatteförhöjning och tullhöjning som
påförs genom ett särskilt beslut, Act no. 781/2013) has already been passed
by Parliament and it entered into force on 1 December 2013. The Act does
not, however, contain any transitional provisions extending its scope
retroactively.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 4 OF PROTOCOL NO. 7 TO
THE CONVENTION
28. The applicant complained under Article 4 of Protocol No. 7 to the
Convention that the ne bis in idem principle had been violated in his case.
Charges had been brought about the same acts which had been subject to
taxation proceedings in which tax surcharges had been imposed. The
taxation proceedings had become final on 1 April 2009 and the criminal
proceedings on 1 September 2010.
29. Article 4 of Protocol No. 7 to the Convention reads as follows:
“1. No one shall be liable to be tried or punished again in criminal proceedings
under the jurisdiction of the same State for an offence for which he has already been
finally acquitted or convicted in accordance with the law and penal procedure of that
State.
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NYKÄNEN v. FINLAND JUDGMENT
2. The provisions of the preceding paragraph shall not prevent the reopening of the
case in accordance with the law and penal procedure of the State concerned, if there is
evidence of new or newly discovered facts, or if there has been a fundamental defect
in the previous proceedings, which could affect the outcome of the case.
3. No derogation from this Article shall be made under Article 15 of the
Convention.”
30. The Government contested that argument.
A. Admissibility
31. The Court notes that the application is not manifestly ill-founded
within the meaning of Article 35 § 3 (a) of the Convention. It further notes
that it is not inadmissible on any other grounds. It must therefore be
declared admissible.
B. Merits
1. The parties’ submissions
(a) The applicant
32. The applicant maintained that, in the taxation proceedings, the
decision of the Administrative Court of 29 May 2008 became final when the
Supreme Administrative Court did not grant the applicant leave to appeal.
He claimed that the speed with which two parallel sets of proceedings were
conducted by the domestic authorities could not be his responsibility as that
was not dependent on him. If such interpretation was accepted, it would be
possible for the State to prolong artificially the length of the proceedings in
order to avoid a violation. The State had the possibility to choose which
proceedings to pursue against the applicant. In his opinion the Convention
should be interpreted in a manner which prevented two parallel sets of
proceedings in the same matter.
33. The applicant noted that tax surcharges had already been imposed on
him on 28 November 2005. In the light of the Supreme Court’s last caselaw (KKO:2013:59), the charges against him concerning tax fraud should
not have been examined at all on the merits after 28 November 2005.
(b) The Government
34. In the Government’s view it was undisputed that the Finnish
administrative proceedings on tax surcharges fell within the domain of
criminal law and thus under the ne bis in idem principle. Furthermore, it was
clear that the second offence arose from the same facts as the first offence.
In the present case, however, the first set of proceedings concerning the tax
surcharges had not yet become final within the meaning of Article 4 of
Protocol No. 7 to the Convention when the second set of proceedings
NYKÄNEN v. FINLAND JUDGMENT
7
concerning the tax fraud became pending. Since the proceedings took place
simultaneously, the present case did not fulfil the res judicata criterion set
for the applicability of the ne bis in idem principle.
35. The Government noted that the Court’s case-law did not seem to
include in the interpretation of the res judicata criterion also the lis pendens
criterion. In the Government’s view, the case Tomasović v. Croatia (see
Tomasović v. Croatia, no. 53785/09, 18 October 2011), in which the Court
applied the ne bis in idem principle although no res judicata effect existed,
could be seen as an isolated exception as the case seemed to involve rather
clearly two sets of proceedings concerning one act which could both be
characterised as criminal proceedings. Furthermore, it did not appear from
that judgment that the Court intended to provide a ne bis in idem effect also
in lis pendens situations as no such express statement was made by the
Court.
36. As to the Supreme Court’s new line of interpretation as expressed by
its case KKO:2013:59, the Government noted that, by this decision, the
Supreme Court had extended the ne bis in idem prohibition beyond the
requirements deriving from human rights obligations. However, they noted
that this line of interpretation was not applicable to criminal matters
adjudicated finally before 5 July 2013. It had thus no effect on the assessment
of the present case as the relevant domestic decisions had become final in
2010. In the Government’s view the Supreme Court’s ruling did not imply that
the earlier line of interpretation by that court was in contradiction with the
Court’s case-law.
37. The Government therefore considered that the tax surcharges
imposed on the applicant did not prevent the examination of the charges for
tax fraud. The applicant was thus not punished twice for the same act within
the meaning of Article 4 of Protocol No. 7 to the Convention as the tax
surcharges had not yet become final when the charges were pressed.
2. The Court’s assessment
(a) Whether the first sanction was criminal in nature?
38. The Court reiterates that the legal characterisation of the procedure
under national law cannot be the sole criterion of relevance for the
applicability of the principle of ne bis in idem under Article 4 § 1 of
Protocol No. 7. Otherwise, the application of this provision would be left to
the discretion of the Contracting States to a degree that might lead to results
incompatible with the object and purpose of the Convention (see for
example Storbråten v. Norway (dec.), no. 12277/04, ECHR 2007-...
(extracts), with further references). The notion of “penal procedure” in the
text of Article 4 of Protocol No. 7 must be interpreted in the light of the
general principles concerning the corresponding words “criminal charge”
and “penalty” in Articles 6 and 7 of the Convention respectively (see
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NYKÄNEN v. FINLAND JUDGMENT
Haarvig v. Norway (dec.), no. 11187/05, 11 December 2007; Rosenquist v.
Sweden (dec.), no. 60619/00, 14 September 2004; Manasson v. Sweden
(dec.), no. 41265/98, 8 April 2003; Göktan v. France, no. 33402/96, § 48,
ECHR 2002-V; Malige v. France, 23 September 1998, § 35, Reports of
Judgments and Decisions 1998-VII; and Nilsson v. Sweden (dec.),
no. 73661/01, ECHR 2005-XIII).
39. The Court’s established case-law sets out three criteria, commonly
known as the “Engel criteria” (see Engel and Others v. the Netherlands,
8 June 1976, Series A no. 22), to be considered in determining whether or
not there was a “criminal charge”. The first criterion is the legal
classification of the offence under national law, the second is the very
nature of the offence and the third is the degree of severity of the penalty
that the person concerned risks incurring. The second and third criteria are
alternative and not necessarily cumulative. This, however, does not rule out
a cumulative approach where separate analysis of each criterion does not
make it possible to reach a clear conclusion as to the existence of a criminal
charge (see Jussila v. Finland [GC], no. 73053/01, §§ 30-31, ECHR
2006-XIV; and Ezeh and Connors v. the United Kingdom [GC], nos.
39665/98 and 40086/98, §§ 82-86, ECHR 2003-X).
40. The Court has taken stand on the criminal nature of tax surcharges,
in the context of Article 6 of the Convention, in the case Jussila v. Finland
(cited above). In that case the Court found that, regarding the first criterion,
it was apparent that the tax surcharges were not classified as criminal but as
part of the fiscal regime. This was, however, not decisive but the second
criterion, the nature of the offence, was more important. The Court observed
that the tax surcharges were imposed by general legal provisions applying to
taxpayers generally. Further, under Finnish law, the tax surcharges were not
intended as pecuniary compensation for damage but as a punishment to
deter re-offending. The surcharges were thus imposed by a rule the purpose
of which was deterrent and punitive. The Court considered that this
established the criminal nature of the offence. Regarding the third Engel
criterion, the minor nature of the penalty did not remove the matter from the
scope of Article 6. Hence, Article 6 applied under its criminal head
notwithstanding the minor nature of the tax surcharge (see Jussila v.
Finland [GC], cited above, §§ 37-38). Consequently, proceedings involving
tax surcharges are “criminal” also for the purpose of Article 4 of Protocol
No. 7.
41. Therefore, in the present case, the Court considers that it is clear that
both sets of proceedings are to be regarded as criminal for the purposes of
Article 4 of Protocol No. 7 to the Convention. The parties also find this to
be undisputed.
NYKÄNEN v. FINLAND JUDGMENT
9
(b) Whether the offences for which the applicant was prosecuted were the
same (idem)?
42. The Court acknowledged in the case of Sergey Zolotukhin v. Russia
(see Sergey Zolotukhin v. Russia [GC], no. 14939/03, §§ 81-84, ECHR
2009) the existence of several approaches to the question whether the
offences for which an applicant was prosecuted were the same. The Court
presented an overview of the existing three different approaches to this
question. It found that the existence of a variety of approaches engendered
legal uncertainty incompatible with the fundamental right not to be
prosecuted twice for the same offence. It was against this background that
the Court provided in that case a harmonised interpretation of the notion of
the “same offence” for the purposes of Article 4 of Protocol No. 7. In the
Zolotukhin case the Court thus found that an approach which emphasised
the legal characterisation of the two offences was too restrictive on the
rights of the individual. If the Court limited itself to finding that a person
was prosecuted for offences having a different legal classification, it risked
undermining the guarantee enshrined in Article 4 of Protocol No. 7 rather
than rendering it practical and effective as required by the Convention.
Accordingly, the Court took the view that Article 4 of Protocol No. 7 had to
be understood as prohibiting the prosecution or trial of a second “offence”
in so far as it arose from identical facts or facts which were substantially the
same. It was therefore important to focus on those facts which constituted a
set of concrete factual circumstances involving the same defendant and
inextricably linked together in time and space, the existence of which had to
be demonstrated in order to secure a conviction or institute criminal
proceedings.
43. In the present case the parties agree that both sets of proceedings
arose from the same facts. The Court agrees with the parties: both sets of
proceedings arose from the same failure by the applicant to declare income.
Both sets of proceedings also concerned the same period of time and the
same amount of evaded taxes.
(c) Whether there was a final decision?
44. The Court reiterates that the aim of Article 4 of Protocol No. 7 is to
prohibit the repetition of criminal proceedings that have been concluded by
a “final” decision (see Franz Fischer v. Austria, no. 37950/97, § 22,
29 May 2001; Gradinger v. Austria, 23 October 1995, § 53, Series A no.
328-C; and Sergey Zolotukhin v. Russia [GC], cited above, § 107).
According to the Explanatory Report to Protocol No. 7, which itself refers
back to the European Convention on the International Validity of Criminal
Judgments, a “decision is final ‘if, according to the traditional expression, it
has acquired the force of res judicata. This is the case when it is irrevocable,
that is to say when no further ordinary remedies are available or when the
parties have exhausted such remedies or have permitted the time-limit to
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NYKÄNEN v. FINLAND JUDGMENT
expire without availing themselves of them’”. This approach is well
entrenched in the Court’s case-law (see, for example, Nikitin v. Russia,
no. 50178/99, § 37, ECHR 2004-VIII; and Horciag v. Romania (dec.),
no. 70982/01, 15 March 2005).
45. Decisions against which an ordinary appeal lies are excluded from
the scope of the guarantee contained in Article 4 of Protocol No. 7 as long
as the time-limit for lodging such an appeal has not expired. On the other
hand, extraordinary remedies such as a request for reopening of the
proceedings or an application for extension of the expired time-limit are not
taken into account for the purposes of determining whether the proceedings
have reached a final conclusion (see Nikitin v. Russia, cited above, § 39).
Although these remedies represent a continuation of the first set of
proceedings, the “final” nature of the decision does not depend on their
being used. It is important to point out that Article 4 of Protocol No. 7 does
not preclude the reopening of the proceedings, as stated clearly by the
second paragraph of Article 4.
46. In the present case the taxation proceedings became final on
1 April 2009 when the Supreme Administrative Court refused the applicant
leave to appeal. No further ordinary remedies were available to the parties.
The taxation decision imposing tax surcharges was therefore “final”, within
the autonomous meaning given to the term by the Convention, on
1 April 2009.
(d) Whether there was a duplication of proceedings (bis)?
47. The Court reiterates that Article 4 of Protocol No. 7 prohibits the
repetition of criminal proceedings that have been concluded by a “final”
decision. Article 4 of Protocol No. 7 is not only confined to the right not to
be punished twice but extends also to the right not to be prosecuted or tried
twice (see Franz Fischer v. Austria, cited above, § 29). Were this not the
case, it would not have been necessary to add the word “punished” to the
word “tried” since this would be mere duplication. Article 4 of Protocol
No. 7 applies even where the individual has merely been prosecuted in
proceedings that have not resulted in a conviction. The Court reiterates that
Article 4 of Protocol No. 7 contains three distinct guarantees and provides
that no one shall be (i) liable to be tried, (ii) tried or (iii) punished for the
same offence (see Nikitin v. Russia, cited above, § 36).
48. The Court notes that Article 4 of Protocol No. 7 clearly prohibits
consecutive proceedings if the first set of proceedings has already become
final at the moment when the second set of proceedings is initiated (see for
example Sergey Zolotukhin v. Russia [GC], cited above).
49. As concerns parallel proceedings, Article 4 of Protocol No. 7 does
not prohibit several concurrent sets of proceedings. In such a situation it
cannot be said that an applicant is prosecuted several times “for an offence
for which he has already been finally acquitted or convicted” (see Garaudy
NYKÄNEN v. FINLAND JUDGMENT
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v. France (dec.), no. 65831/01, ECHR 2003-IX (extracts)). There is no
problem from the Convention point of view either when, in a situation of
two parallel sets of proceedings, the second set of proceedings is
discontinued after the first set of proceedings has become final (see
Zigarella v. Italy (dec.), no. 48154/99, ECHR 2002-IX (extracts)).
However, when no such discontinuation occurs, the Court has found a
violation (see Tomasović v. Croatia, cited above, § 31; and Muslija v.
Bosnia and Herzegovina, no. 32042/11, § 37, 14 January 2014).
50. However, the Court has also found in its previous case-law (see R.T.
v. Switzerland (dec.), no. 31982/96, 30 May 2000; and Nilsson v. Sweden
(dec.), no. 73661/01, 13 December 2005) that although different sanctions
(suspended prison sentences and withdrawal of driving licences) concerning
the same matter (drunken driving) have been imposed by different
authorities in different proceedings, there has been a sufficiently close
connection between them, in substance and in time. In those cases the Court
found that the applicants were not tried or punished again for an offence for
which they had already been finally convicted in breach of Article 4 § 1 of
Protocol No. 7 to the Convention and that there was thus no repetition of the
proceedings.
51. Turning to the present case and regarding whether there was
repetition in breach of Article 4 § 1 of Protocol No. 7 to the Convention, the
Court notes that it is true that both the applicant’s conviction and the tax
surcharges imposed on him form a part of the sanctions under Finnish law
for the failure to provide information about income in a tax declaration with
a result that too low tax assessment is made. However, under the Finnish
system the criminal and the administrative sanctions are imposed by
different authorities without the proceedings being in any way connected:
both sets of proceedings follow their own separate course and become final
independently from each other. Moreover, neither of the sanctions is taken
into consideration by the other court or authority in determining the severity
of the sanction, nor is there any other interaction between the relevant
authorities. More importantly, the tax surcharges are under the Finnish
system imposed following an examination of an applicant’s conduct and his
or her liability under the relevant tax legislation which is independent from
the assessments made in the criminal proceedings. This contrasts with the
Court’s earlier cases R.T. and Nilsson relating to driving licences, where the
decision on withdrawal of the licence was directly based on an expected or
final conviction for a traffic offence and thus did not contain a separate
examination of the offence or conduct at issue. Therefore, it cannot be said
that, under the Finnish system, there is a close connection, in substance and
in time, between the criminal and the taxation proceedings.
52. Consequently, the present case concerns two parallel and separate
sets of proceedings of which the first set became final on 1 April 2009 while
the second set was initiated on 19 August 2008. The two sets of proceedings
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NYKÄNEN v. FINLAND JUDGMENT
were thus pending concurrently until 1 April 2009 when the first set became
final. As the second set of proceedings was not discontinued after the first
set of proceedings became final but was continued until a final decision on
1 September 2010, the applicant was convicted twice for the same matter in
two sets of proceedings which became final on 1 April 2009 and
1 September 2010 respectively.
53. The Court would acknowledge in this connection that it might
sometimes be coincidental which of the parallel proceedings first becomes
final, thereby possibly creating a concern about unequal treatment.
However, in view of the margin of appreciation left to High Contracting
Parties, it falls within their power to determine their own criminal policy
and the manner in which their legal system is organised. The High
Contracting Parties are free to develop their criminal policy and legal
system in accordance with their applicable international obligations, in
particular the Convention and its Protocols (see mutatis mutandis Achour v.
France [GC], no. 67335/01, § 44, ECHR 2006-IV). It appears that in
Finland the case-law and the legislation have already been modified
accordingly.
54. In conclusion, the Court finds that there has been a violation of
Article 4 of Protocol No. 7 to the Convention since the applicant was
convicted twice for the same matter in two separate sets of proceedings.
II. APPLICATION OF ARTICLE 41 OF THE CONVENTION
55. Article 41 of the Convention provides:
“If the Court finds that there has been a violation of the Convention or the Protocols
thereto, and if the internal law of the High Contracting Party concerned allows only
partial reparation to be made, the Court shall, if necessary, afford just satisfaction to
the injured party.”
A. Damage
56. The applicant claimed EUR 5,500 in respect of pecuniary damage as
lost income during the imprisonment and EUR 27,000 for suffering caused
by his imprisonment. He also claimed EUR 3,000 in respect of nonpecuniary damage caused by the violation.
57. The Government noted that the applicant had a possibility to ask for
compensation for imprisonment, including loss of income, if the domestic
judgment was revoked. Therefore his claims in respect of the claimed
EUR 5,500 and EUR 27,000 should be rejected. As to the non-pecuniary
damage, the Government considered that the applicant should be awarded
reasonable compensation if the Court were to find a violation under
Article 4 of Protocol No. 7 to the Convention. In their view, in the present
circumstances, the award should not exceed EUR 1,000.
NYKÄNEN v. FINLAND JUDGMENT
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58. The Court notes that the charges brought against the applicant
contained several different counts. For the Court it is not possible to
speculate whether the violation found would lead to the annulment of the
entire judgment convicting the applicant or not. As the domestic system
provides a possibility to obtain pecuniary and non-pecuniary compensation
in such situations, the Court rejects the claims of EUR 5,500 and
EUR 27,000. On the other hand, the Court awards the applicant EUR 3,000
in respect of non-pecuniary damage.
B. Costs and expenses
59. The applicant also claimed EUR 2,511 (inclusive of value-added tax)
for the costs and expenses incurred before the Court.
60. The Government considered that the applicant’s claim for costs and
expenses was excessive as to quantum. In the Government’s view, the
award for costs and expenses should not exceed EUR 1,350 (inclusive of
value-added tax).
61. According to the Court’s case-law, an applicant is entitled to the
reimbursement of costs and expenses only in so far as it has been shown
that these have been actually and necessarily incurred and are reasonable as
to quantum. In the present case, regard being had to the documents in its
possession and the above criteria, the Court considers it reasonable to award
the sum of EUR 2,500 (inclusive of value-added tax) for the proceedings
before the Court.
C. Default interest
62. The Court considers it appropriate that the default interest rate
should be based on the marginal lending rate of the European Central Bank,
to which should be added three percentage points.
FOR THESE REASONS, THE COURT UNANIMOUSLY
1. Declares the application admissible;
2. Holds that there has been a violation of Article 4 of Protocol No. 7 to the
Convention;
3. Holds
(a) that the respondent State is to pay the applicant, within three months
from the date on which the judgment becomes final in accordance with
Article 44 § 2 of the Convention, the following amounts:
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NYKÄNEN v. FINLAND JUDGMENT
(i) EUR 3,000 (three thousand euros), plus any tax that may be
chargeable, in respect of non-pecuniary damage;
(ii) EUR 2,500 (two thousand five hundred euros), plus any tax that
may be chargeable to the applicant, in respect of costs and
expenses;
(b) that from the expiry of the above-mentioned three months until
settlement simple interest shall be payable on the above amounts at a
rate equal to the marginal lending rate of the European Central Bank
during the default period plus three percentage points;
4. Dismisses the remainder of the applicant’s claim for just satisfaction.
Done in English, and notified in writing on 20 May 2014, pursuant to
Rule 77 §§ 2 and 3 of the Rules of Court.
Françoise Elens-Passos
Registrar
Ineta Ziemele
President

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